The Gazette covers City Hall, now a flood-damaged icon on May's Island in the Cedar River

Clearing city of hundreds and hundreds of flood-wrecked homes nears reality: HUD changes formula and sends Iowa bigger pot of disaster-relief funds

In City Hall, Floods on June 9, 2009 at 6:05 pm

It was possible to imagine a future Tuesday in which hundreds and hundreds of flood-wrecked Cedar Rapids homes no longer are sitting, empty and ugly.

A much-awaited announcement by the U.S. Department of Housing and Urban Development will be sending a new round of Community Development Block Grant funds into Iowa totally $516.7 million. The state also will be able to compete for a share of another $300 million of new CDBG money, a pleased Rep. Dave Loebsack, D-Mount Vernon, announced Tuesday afternoon.

“I think it’s progress,” Loebsack said. “We’re on the road to recovery and rebuilding.”

Cedar Rapids, with more than 50 percent of the flood damage in Iowa a year ago, will get some sizable share of the new money coming into the state.

Council member Chuck Wieneke, who is the council’s lead voice on buyouts of flood-damaged properties, said Tuesday that the city’s first priority for the new CDBG money will be the buyout of flood-damaged homes. The city has estimated it may need to buy out 1,300 homes at a cost of $175 million.

Wieneke noted that the latest HUD money won’t arrive in the city tomorrow, but he said he hoped the city might see it by latter in the summer.

Jennifer Pratt, the city’s development coordinator, on Tuesday reported that more than 1,000 people have begun the city’s buyout process as the city prepared to purchase some 554 flood-damaged homes in the proposed levee construction area and another 600 or so homes elsewhere beyond reasonable repair. The city has initiated the buyout process so it is poised to buy out properties quickly once CDBG money arrives, Pratt pointed out.

Another group of 167 property owners, which own flood-damaged homes closest to the river, are ready for buyouts using Federal Emergency Management funds. The FEMA money could be here by late August, Pratt said.

City Manager Jim Prosser on Tuesday said the city had hoped, at a minimum, to garner $200 million in the latest allocation of CDBG funds. It remains to be seen if the city gets that much from the state of Iowa’s allocation of $516.7 million, he said.

However, Wieneke and Mayor Kay Halloran both emphasized that Cedar Rapids sustained more than 50 percent of the flood damage in the state a year ago, though both said the city had not managed yet to get that large a share of federal funds coming through the state.

Prosser said the city will use the CDBG money for buyouts, new replacement housing and reconstruction of city infrastructure in flood-damaged neighborhoods.

Key will be rules that accompany the money, the city manager noted.

One HUD spokesman on Tuesday said, for instance, that the new CDBG money could be used to supplement FEMA disaster funds that will come to the city to repair or rebuild flood-damaged public buildings.

Much attention by Iowa’s Congressional delegation and Iowa’s state and local officials has been devoted since late last year to the formula HUD has used to dispense disaster funds among some 30 states that have had disasters in the last year.

HUD apparently changed the formula this time.

In a HUD allocation in November, Iowa received $125 million or 5.8 percent of the $2 billion total. Now, Iowa will receive 13.2 percent of the $3.9 billion total.

In a phone interview Tuesday, Congressman Loebsack said that HUD Secretary Shaun Donovan told him that Iowa fared better in the latest formula because of a factor in the formula addressing “unmet needs.”

“For me the bottom line is I think I made the case for Iowa and certainly for the Second (Congressional) District,” Loebsack said. “My goal is to make sure that the people of Cedar Rapids and the Second District as a whole get their fair share and get what they deserve.”

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